COMMONWEALTH OF MASSACHUSETTS

Suffolk, SS.

FINDINGS OF FACT AND TEMPORARY ORDER TO CEASE AND DESIST

In the Matter of FIDELITY HOME MORTGAGE CORPORATION d/b/a MARYLAND FIDELITY HOME Baltimore, Maryland

Mortgage Lender and Mortgage Broker License No(s): MC4719; MC5037

The Commissioner of Banks ("Commissioner") having determined that FIDELITY HOME MORTGAGE CORPORATION d/b/a MARYLAND FIDELITY HOME ("Fidelity Home Mortgage" or the "Corporation"), located at 1012 North Point Road, Baltimore, Maryland has engaged in, or is engaging in, or is about to engage in, acts or practices constituting violations of Massachusetts General Laws chapter 255E and applicable regulations found at 209 CMR 42.00 et seq., hereby issues the following FINDINGS OF FACT AND TEMPORARY ORDER TO CEASE AND DESIST ("Temporary Order") pursuant to General Laws chapter 255E, section 7(b).

FINDINGS OF FACT

The Division of Banks ("Division"), through the Commissioner, has jurisdiction over the licensing and regulation of persons and entities engaged in the business of a mortgage lender and mortgage broker in Massachusetts pursuant to Massachusetts General Laws chapter 255E, section 2.

Fidelity Home Mortgage is, and at all relevant times has been, a foreign corporation conducting business in the Commonwealth of Massachusetts. Fidelity Home Mortgage's main office is located at 1012 North Point Road, Baltimore, Maryland.

Fidelity Home Mortgage is licensed by the Commissioner as a mortgage lender and mortgage broker under Massachusetts General Laws chapter 255E, section 2. According to records maintained on file with the Division, the Commissioner initially issued a mortgage company license to Fidelity Home Mortgage to engage in the business of a mortgage lender and mortgage broker in Massachusetts on or about April 2, 2007, with license number MC4719. License number MC4719 authorized Fidelity Home Mortgage to conduct the mortgage company business from the Corporation's main office located at 1012 North Point Road, Baltimore, Maryland.

Fidelity Home Mortgage maintains an additional licensed office location at 730 North Broad Street, Suite 100, Woodbury, New Jersey, from which the Corporation conducts its mortgage lender and mortgage broker business. According to records maintained on file with the Division, the Commissioner issued a mortgage company license, license number MC5037, to Fidelity Mortgage for that location on or about July 27, 2007.

According to the Division's records, Stilianos Mavroulis is the president, and sole shareholder of Fidelity Home Mortgage.

According to the Division's records, Kyriakos Mavroulis serves as the vice president of Fidelity Home Mortgage.

On February 28, 2008, a federal Grand Jury, impaneled in the United States District Court, Maryland District, returned an indictment against Stilianos Mavroulis charging him with five felony counts, including: one count of conspiracy to commit offense(s) against the United States, or to defraud the United States, or any agency thereof, in violation of 18 U.S.C. §371 and four counts of making and subscribing to false tax returns, in violation of 26 U.S.C §7206(1).

On February 28, 2008, a federal Grand Jury, impaneled in the United States District Court, Maryland District, returned an indictment against Kyriakos Mavroulis charging him with two felony counts including: one count one count of conspiracy to commit offense(s) against the United States, or to defraud the United States, or any agency thereof, in violation of 18 U.S.C. §371 and one count of making and subscribing to false tax returns, in violation of 26 U.S.C §7206(1).

The indictment alleged that that for approximately six years between 1998 and 2004, Stilianos Mavroulis and Kyriakos Mavroulis, who were responsible for managing Fidelity Home Mortgage's accounting department, allegedly "knowingly and intentionally combine[d], conspire[d], confederate[d] and agree[d] together and with one another to defraud the United States."

The indictment further alleged that between 1998 and 2003, Stilianos Mavroulis and Kyriakos Mavroulis diverted at least $1.9 million from Fidelity Home Mortgage's funds to pay for personal family expenses. As a result, the Mavroulis family underpaid their individual income taxes by "at least $540,000."

The indictment alleged that both Stilianos and Kyriakos Mavroulis caused Fidelity Home Mortgage to pay the Mavroulis children, who worked at Fidelity Home Mortgage "under the table in order to permit them to avoid paying income taxes on income received" from the Corporation.

A press release issued on February 28, 2008, by the United States Attorney's Office, in Baltimore, Maryland ("press release"), alleged that Stilianos and Kyriakos Mavroulis used Fidelity Home Mortgage's funds to "make personal investments in the stock market, including $100,000 to fund, among other things, personal investments through E-Trade; finance the operations of Fidelity Promotions, a company [Stilianos Mavroulis] owned and established in connection with a personal musical venture in Greece; and pay airfare and hotels in traveling to Greece."

The Division's regulation at 209 CMR 42.12(2) states, in part, that:

A Licensee shall notify the Commissioner immediately, and in writing within five business days, of the occurrence of any of the following significant developments: . . . (b) Criminal felony indictment or conviction of any of the Licensee's officers, directors, principal stockholders, or affiliates.

As of the effective date of this Temporary Order, the Division has not received notification from Fidelity Home Mortgage of the occurrence of the events referenced above in Paragraph 7 through 12, inclusive, of this Temporary Order.

By a letter dated March 27, 2008, which was received by the Division on or around March 28, 2008, Fidelity Home Mortgage filed a written notice with the Division proposing changes among the ownership and officers of Fidelity Home Mortgage. The request indicated that as of April 1, 2008, Stilianos Mavroulis would be transferring the ownership of the Corporation, in its entirety, to his spouse on April 1, 2008.

Fidelity Home Mortgage's March 27 th letter did not specifically address, what changes, if any, would occur relative to Kyriakos Mavroulis' status with Fidelity Home Mortgage although he was not included in the proposed designation of officers and directors which was to take effect as of April 1, 2008.

As of the effective date of this Temporary Order, the Division has neither approved nor denied the proposed changes in the ownership and officers of Fidelity Home Mortgage.

The Division's regulation 209 CMR 42.12(3)(a) states:

(a) 15 days prior to any proposed change in control in the ownership of a Licensee, or among the officers, partners or directors of a Licensee, a notice shall forthwith be filed with the Commissioner who may thereupon cause such investigation to be made as he deems necessary, as if it were a new license. In the case of a corporation, control is defined as a change of ownership by a person or group acting in concert to acquire ten percent of the stock, or the ability of a person or group acting in concert to elect a majority of the directors or otherwise effect a change in policy of the corporation.

CONCLUSIONS OF LAW

Based upon the information contained in Paragraphs 1 through 18, by failing to notify the Commissioner, in writing, within five business days that on February 28, 2008, Stilianos Mavroulis, president and sole shareholder of Fidelity Home Mortgage was indicted on five felony counts in the United States District Court for the District of Maryland, Fidelity Home Mortgage violated 209 CMR 42.12(2)(b).

Based upon the information contained in Paragraphs 1 through 18, by failing to notify the Commissioner, in writing, within five business days that on February 28, 2008, Kyriakos Mavroulis, vice president of Fidelity Home Mortgage was indicted on two felony counts in the United States District Court for the District of Maryland, Fidelity Home Mortgage violated 209 CMR 42.12(2)(b).

Based upon the information contained in Paragraphs 1 through 18, by failing to notify the Commissioner, in writing, of a change in ownership fifteen days prior to the change, Fidelity Home Mortgage violated 209 CMR 42.12(3)(a).

Based upon the information contained in Paragraphs 1 through 18, Fidelity Home Mortgage has failed to demonstrate the financial responsibility, character, reputation, integrity, and general fitness that would warrant the belief that the business will be operated honestly, fairly, and soundly in the public interest in violation of Massachusetts General Laws chapter 255E, section 4 and the Division's regulation 209 CMR 42.03(2)(c) and 209 CMR 42.06(2)(c).

Based upon the information contained in Paragraphs 1 through 18, the Commissioner has determined that:

Fidelity Home Mortgage, a Corporation owned by Stilianos Mavroulis during all relevant times is engaging in, has engaged in, or is about to engage in, acts or practices which warrant the belief that it is not operating honestly, fairly, soundly and efficiently in the public interest in violation of standards governing the licensing and conduct of a mortgage lender and mortgage broker including, but not limited to, the provisions of the Division's regulations at 209 CMR 42.00 et seq.; and

The public interest will be irreparably harmed by delay in issuing an ORDER TO CEASE AND DESIST to Fidelity Home Mortgage.

ORDER TO CEASE AND DESIST

After taking into consideration the FINDINGS OF FACT and CONCLUSIONS OF LAW stated herein, it is hereby:

ORDERED that Fidelity Home Mortgage and any and all, officers, directors, employees, independent contractors, or agents operating on behalf of Fidelity Home Mortgage, and their successors or assigns, shall immediately cease engaging in the activities of a mortgage lender and mortgage broker, as defined under Massachusetts General Laws chapter 255E, section 1, relative to any residential property in Massachusetts, not otherwise expressly permitted by the terms of this Temporary Order. Therefore, Fidelity Home Mortgage is ordered to immediately cease soliciting or accepting, either directly or indirectly, any residential mortgage loan applications from consumers for residential property located in Massachusetts.

IT IS FURTHER ORDERED that Fidelity Home Mortgage shall immediately place with one or more qualified broker(s) or lender(s), as appropriate based on the status of the application and with no loss to applicants, all of its pending Massachusetts residential mortgage loan applications. Fidelity Home Mortgage shall obtain the prior approval of the Commissioner before placing such applications to the qualified broker(s) or lender(s).

IT IS FURTHER ORDERED that Fidelity Home Mortgage shall submit to the Commissioner a detailed record, prepared as of the date of submission, of all of the Corporation's pending residential mortgage loan applications on property located in Massachusetts. The records to be produced shall be submitted to the Commissioner within five (5) days of the effective date of this Temporary Order and shall include all information on file, regarding the Corporation's open application list, including but not necessarily limited to, the following:

All information on file as of the date of submission regarding Fidelity Home Mortgage's open application list, including but not limited to, the following: The names of all individuals from whom Fidelity Home Mortgage has accepted an application for a residential mortgage loan; an indication of whether Fidelity Home Mortgage accepted the application in its capacity as a mortgage lender or mortgage broker in the transaction; the applicants' addresses and telephone numbers; the amount of all prepaid loan fees submitted by the customer; the amount of each loan; application status (i.e. filed, submitted to lenders, cleared to close, etc.); scheduled closing dates; rate lock status; and a list identifying the applicable broker(s) or lender(s) with whom the applicants' application was placed. The latter list should include telephone numbers of contact persons familiar with the Corporation's submitted loans.

IT IS FURTHER ORDERED that Fidelity Home Mortgage shall immediately secure all pending residential mortgage loan application files and shall make such files, in their entirety, available to the Commissioner upon request.

IT IS FURTHER ORDERED that this Temporary Order shall become effective immediately and shall remain in effect unless set aside, limited, or suspended by the Commissioner or upon court order after review under General Laws chapter 30A.

IT IS FURTHER ORDERED that a hearing will be scheduled on this matter to determine whether or not such Temporary Order shall become permanent and final only upon receipt of a written request for such a hearing from Fidelity Home Mortgage within twenty (20) days of the effective date of this Temporary Order. If no hearing is requested within this twenty (20) day period, this Temporary Order shall become permanent and final until it is modified or vacated by the Commissioner.